<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 30, 1996
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file Number 0-4543
MARK TWAIN BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
Missouri 43-0895344
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
8820 Ladue Road
St. Louis, Missouri
(Address of principal executive offices)
63124
(Zip Code)
Registrant's telephone number, including area code:
(314) 727-1000
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes /X/ No / /
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the close of the period covered by
this report.
Class Outstanding at September 30, 1996
Common Stock, $1.25 par value 16,384,722
<PAGE> 2
MARK TWAIN BANCSHARES, INC.
AND SUBSIDIARIES
Index
Part I. - Financial Information
Item 1. - Financial Statements
Condensed Consolidated Balance Sheet
September 30, 1996 and 1995 (unaudited)
and December 31, 1995.................................3
Condensed Consolidated Statement of Income
for the three and nine month periods
ended September 30, 1996 and 1995 (unaudited).........4
Condensed Consolidated Statement of Cash
Flows for the nine month periods ended
September 30, 1996 and 1995 (unaudited)...............5
Notes to Condensed Consolidated Financial
Statements (unaudited)................................6
Item 2. - Management's Discussion and Analysis
of Financial Condition and Results of Operations......8
Part II. - Other Information......................................20
Item 6. - Exhibits and Reports on Form 8-K......................20
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM I - FINANCIAL STATEMENTS
<TABLE>
MARK TWAIN BANCSHARES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
<CAPTION>
September 30, December 31,
-------------------------
(in thousands of dollars) 1996 1995 1995
- ------------------------------------------------------------------------------------ ------------ ------------
<S> <C> <C> <C>
ASSETS
Cash and due from banks $ 169,932 $ 122,380 $ 156,207
Federal funds sold and securities
purchased under resale agreements 15,879 4,528 7,900
Held to maturity securities 225,384 351,325 244,094
Available for sale securities 459,690 245,312 445,808
Trading securities 43,669 62,697 63,579
Loans, net of allowance for loan losses of
$32,068, $30,048 and $30,508, respectively 2,111,150 1,908,537 1,941,431
Premises and equipment 21,283 21,538 20,764
Accrued income receivable 18,096 18,500 17,830
Other assets 82,850 99,101 70,618
- ---------------------------------------------------------------------------------- ---------- ----------
Total assets $3,147,933 $2,833,918 $2,968,231
- ------------------------------------------------------------------------========== ========== ==========
LIABILITIES
Non-interest bearing deposits $ 449,001 $ 428,686 $ 519,155
Interest bearing deposits 1,983,483 1,905,133 1,938,237
- ---------------------------------------------------------------------------------- ---------- ----------
Total deposits 2,432,484 2,333,819 2,457,392
- ---------------------------------------------------------------------------------- ---------- ----------
Short-term borrowings 359,192 146,393 165,731
Other liabilities 64,399 70,422 50,712
Long-term debt 2,425 19,423 18,490
- ---------------------------------------------------------------------------------- ---------- ----------
Total liabilities 2,858,500 2,570,057 2,692,325
- ---------------------------------------------------------------------------------- ---------- ----------
SHAREHOLDERS' EQUITY
Common stock, $1.25 par value, authorized
30,000,000 shares, issued 16,871,183,
16,449,510 and 16,508,220 shares, respectively 21,089 20,562 20,635
Surplus 67,077 62,423 63,630
Undivided profits 219,932 186,743 194,888
Net unrealized gains (losses) on available
for sale securities (3,981) (1,628) 1,026
- ---------------------------------------------------------------------------------- ---------- ----------
304,117 268,100 280,179
Less common treasury stock at cost, 486,461,
389,579, and 362,685 shares, respectively 14,684 4,239 4,273
- ---------------------------------------------------------------------------------- ---------- ----------
Total shareholders' equity 289,433 263,861 275,906
- ---------------------------------------------------------------------------------- ---------- ----------
Total liabilities and shareholder's equity $3,147,933 $2,833,918 $2,968,231
- ------------------------------------------------------------------------========== ========== ==========
See notes to condensed consolidated financial statements.
</TABLE>
PAGE> 4
<TABLE>
MARK TWAIN BANCSHARES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
<CAPTION>
For the Nine Months For the Three Months
Ended September 30, Ended September 30,
(in thousands of dollars except per share data) 1996 1995 1996 1995
- ------------------------------------------------------------------------------------------------ ---------------------
<S> <C> <C> <C> <C>
INTEREST FROM EARNING ASSETS
Interest and fees on loans $134,902 $135,477 $45,679 $46,251
Interest on held to maturity securities:
Taxable 11,543 17,235 3,682 5,744
Non-taxable 101 142 33 33
Interest on available for sale securities 20,903 11,139 6,863 3,730
Interest on trading securities 2,401 2,113 544 678
Interest on federal funds sold and securities
purchased under resale agreements 359 563 130 264
- ------------------------------------------------------------------------------------------------ --------------------
Total interest income 170,209 166,669 56,931 56,700
- ------------------------------------------------------------------------------------------------ --------------------
INTEREST EXPENSE
Interest on deposits 66,012 62,196 22,011 22,512
Interest on short-term borrowings 9,482 6,938 3,206 1,624
Interest on long-term debt 309 1,165 35 381
- ------------------------------------------------------------------------------------------------ --------------------
Total interest expense 75,803 70,299 25,252 24,517
- ------------------------------------------------------------------------------------------------ --------------------
Net interest income 94,406 96,370 31,679 32,183
Provision for loan losses 2,001 3,344 506 713
- ------------------------------------------------------------------------------------------------ --------------------
Net interest income after provision for loan losses 92,405 93,026 31,173 31,470
- ------------------------------------------------------------------------------------------------ --------------------
OTHER INCOME
Service charges on deposit accounts 6,061 5,220 2,056 1,803
Securities transactions 234 46 - -
Other income 22,905 22,123 7,673 7,281
- ------------------------------------------------------------------------------------------------ --------------------
Total other income 29,200 27,389 9,729 9,084
- ------------------------------------------------------------------------------------------------ --------------------
OTHER EXPENSES
Salaries 31,692 31,098 10,333 10,530
Employee benefits 5,276 5,202 1,424 1,569
Net occupancy expense 6,716 7,040 2,257 2,326
Furniture and equipment expense 2,581 2,894 831 917
Other expenses 14,173 18,386 4,646 5,398
- ------------------------------------------------------------------------------------------------ --------------------
Total other expenses 60,438 64,620 19,491 20,740
- ------------------------------------------------------------------------------------------------ --------------------
Income before income taxes 61,167 55,795 21,411 19,814
Applicable income taxes 22,197 20,579 7,947 7,591
- ------------------------------------------------------------------------------------------------ --------------------
Net income $ 38,970 $ 35,216 $13,464 $12,223
- ---------------------------------------------------------------------------===================== ====================
NET INCOME PER SHARE
- ------------------------------------------------------------------------------------------------ --------------------
Primary $2.38 $2.17 $0.83 $0.75
- ------------------------------------------------------------------------------================== ====================
Fully diluted $2.35 $2.11 $0.82 $0.73
- ------------------------------------------------------------------------------================== ====================
COMMON DIVIDENDS PAID PER SHARE $0.93 $0.81 $0.31 $0.27
- ------------------------------------------------------------------------------================== ====================
See notes to condensed consolidated financial statements.
</TABLE>
<PAGE> 5
<TABLE>
MARK TWAIN BANCSHARES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
<CAPTION>
For the Nine Months
Ended September 30,
(in thousands of dollars) 1996 1995
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 38,970 $ 35,216
Adjustments to reconcile net cash provided by operating activities:
Provision for loan losses 2,001 3,344
Provision for depreciation and amortization 2,974 3,561
Amortization of security premiums and accretion of discounts (536) (799)
Net (increase) decrease in trading securities 19,910 (29,788)
Securities transactions (234) (46)
Increase (decrease) in accrued income receivable 256 (928)
Increase (decrease) in interest payable (877) 1,187
Other 1,000 3,664
- ----------------------------------------------------------------------------------------- -------
Net cash provided by operating activities 63,464 15,411
- ----------------------------------------------------------------------------------------- -------
INVESTING ACTIVITIES
Net increase in loans (132,868) (78,086)
Proceeds from sales of foreclosed property 3,776 2,392
Net (increase) decrease in premises and equipment (1,324) 3,415
Purchase of assets to be leased (809) (2,783)
Proceeds from sale of available for sale securities 36,175 5,676
Proceeds from maturities and prepayments of available for sale securities 46,776 19,495
Purchase of available for sale securities (82,318) (17,269)
Proceeds from maturities and prepayments of held to maturity securities 37,691 37,112
Purchase of held to maturity securities (19,074) (45,268)
Net cash of acquired company 9,949 -
- ----------------------------------------------------------------------------------------- --------
Net cash used by investing activities (102,026) (75,316)
- ----------------------------------------------------------------------------------------- --------
FINANCING ACTIVITIES
Net increase (decrease) in deposits (87,020) 61,762
Net increase (decrease) in short-term borrowings 190,712 (1,725)
Payments on long-term debt (11,582) (32)
Cash dividends (15,017) (12,986)
Purchase of treasury stock (18,380) (3,145)
Reissuance of treasury stock 1,553 1,392
- ----------------------------------------------------------------------------------------- --------
Net cash used by financing activities 60,266 45,266
- ----------------------------------------------------------------------------------------- --------
Increase (decrease) in cash and cash equivalents 21,704 (14,639)
Cash and cash equivalents at beginning of period 164,107 141,547
- ----------------------------------------------------------------------------------------- --------
Cash and cash equivalents at end of period $185,811 $126,908
- ---------------------------------------------------------------------------------======== ========
See notes to condensed consolidated financial statements.
</TABLE>
<PAGE> 6
MARK TWAIN BANCSHARES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE A--BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q
and Article 10 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three and nine month periods ended September 30, 1996 are
not necessarily indicative of the results that may be expected for the year
ended December 31, 1996. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1995.
NOTE B--PREMISES AND EQUIPMENT
In June 1995 the Company sold a low- to moderate-income housing project
which it owned and operated. The proceeds from the sale approximated the
book value of $5.0 million.
NOTE C--LONG-TERM DEBT
On January 16, 1996, the Company instructed the trustee to call the 8 1/2%
debentures due 1999 for redemption at a premium over par of 1% effective
March 1, 1996. The outstanding balance of the debentures at the time of
redemption was $11,579,000.
NOTE D--STOCK EXCHANGE
On September 19, 1996, the Company listed and began trading its common
stock on the New York Stock Exchange under the symbol MTB.
NOTE E--ACQUISITION/MERGER OF BANKS
On February 6, 1995, United Kansas Bank & Trust, which was acquired in
November 1994, was merged into Mark Twain Kansas Bank. On November 6,
1995, Mark Twain Kansas Bank was merged into Mark Twain Kansas City Bank.
On July 17, 1996, the Company announced that it has reached an agreement
with First City Bancshares, Incorporated of Springfield, Missouri (First
City), owner of First City National Bank, in Springfield, Missouri
(approximately $90 million in assets), for the merger of First City into a
Mark Twain subsidiary. Consummation of this transaction is expected to
occur in the fourth quarter of 1996 and will be accounted for as a
purchase.
On September 9, 1996, the Company acquired Northland Bancshares, Inc.
(Northland), owner of First National Bank of Platte County, in Kansas City,
<PAGE> 7
NOTES (continued)
Missouri (approximately $72 million in assets). The transaction was
accounted for under the pooling-of-interests method of accounting. Prior
financial information was not restated as the transaction was not material
to the consolidated financial position or results of operations of the
Company.
NOTE F--SUBSEQUENT EVENTS
On October 27, 1996, the Company entered into an Agreement and Plan of
Reorganization between the Company, Mercantile Bancorporation Inc.
(Mercantile) and Ameribanc, Inc. (Merger Sub) under which Mercantile would
acquire the Company through a merger of Company with and into Merger Sub.
Upon consummation of the Merger, each issued and outstanding share of the
Company's common stock would be converted into and become the right to
receive .952 shares of Mercantile common stock. Shareholder and regulatory
approvals of the Plan of Reorganization are pending. If approved, plans
call for the merger to be completed in the second quarter of 1997.
<PAGE> 8
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ----------------------
At September 30, 1996 the Company achieved increases in total assets,
total loans, earning assets and deposits over September 30, 1995 levels.
Net income for the three month period ended September 30, 1996 was $13.464
million, an increase of $1.241 million or 10.2% from the third quarter of
1995. Primary earnings per share for the third quarter of 1996 increased
10.7% to total $0.83, compared to $0.75 for the third quarter of 1995.
Fully diluted earnings per share for the third quarter of 1996 were $0.82,
an increase of 12.3% over $0.73 for the third quarter of 1995. Net income
for the nine month period ended September 30, 1996 was $38.970 million, an
increase of $3.754 million or 10.7% over the same period in 1995. Primary
earnings per share for the first nine months of 1996 were $2.38, an
increase of 9.7% over the same period last year. Fully diluted earnings
per share for the first nine months of 1996 was $2.35, an increase of 11.4%
over $2.11 for the first nine months of 1995. Selected comparisons are as
follows (in millions of $):
<TABLE>
<CAPTION>
September 30,
1996 1995 % Change
--------------------------------------
<S> <C> <C> <C>
Total assets $3,147.9 $2,833.9 11.1%
Total loans 2,143.2 1,938.6 10.6%
Total earning assets 2,894.3 2,605.1 11.1%
Total deposits 2,432.5 2,333.8 4.2%
</TABLE>
<TABLE>
NET INTEREST INCOME
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
1996 1995 % Change 1996 1995 % Change
--------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Average loans $2,007.8 $1,908.8 5.2% $2,042.3 $1,938.6 5.3%
Average earning assets 2,755.6 2,552.3 8.0% 2,761.5 2,586.2 6.8%
Average deposits 2,356.9 2,256.5 4.5% 2,356.8 2,323.3 1.4%
Net interest income (FTE) 95.3 97.3 (2.1%) 32.0 32.5 (1.5%)
Net interest margin 4.62% 5.10% (48 basis 4.61% 4.98% (37 basis
points) points)
</TABLE>
Measured on a fully tax equivalent basis, net interest income totaled $32.0
million for the third quarter of 1996 compared to $32.5 million for the
third quarter of 1995 and $31.6 million in the second quarter of 1996. Net
interest margin for the third quarter of 1996 was 4.61% compared to 4.98%
for the third quarter of 1995 and 4.62% for the second quarter of 1996. For
the first nine months of 1996, net interest income, measured on a fully tax
equivalent basis, totaled $95.3 million compared to $97.3 million for the
same period last year. Net interest margin for the first nine months of
1996 was 4.62% compared to 5.10% for the same period last year. Due to
competitive factors, a decline in the prime rate and increased securities
purchases this year, the net interest margin decline was anticipated. The
average prime rate for the first nine months and the third quarter of 1996
were 64 and 50 basis points, respectively, less than the average prime rate
<PAGE> 9
(Net Interest Income continued)
for the same periods of 1995. As earning assets and interest bearing
liabilities repriced during 1995 and 1996 with the gradual decline in
interest rates and as the mix of earning assets and interest bearing
liabilities changed between periods, the gross yield on earning assets
decreased 49 basis points for both the first nine months of 1996 and the
third quarter of 1996 compared to 1995 levels. The average cost of
interest bearing liabilities decreased slightly by 1 basis point for the
first nine months of 1996, but decreased 17 basis points for the third
quarter of 1996 compared to the same periods last year. The interest rate
spread for the first nine months of 1996 decreased 48 basis points to 3.71%
compared to the same period last year. The ratio of average interest
bearing liabilities to average earning assets decreased to 80.2% for the
first nine months of 1996 compared to 80.3% for the first nine months of
1995. The interest rate spread for the third quarter of 1996 decreased 32
basis points to 3.70% compared to the third quarter of 1995. The ratio of
average interest bearing liabilities to average earning assets increased to
79.9% for the third quarter of 1996 compared to 79.7% for the same period
in 1995.
Average earning assets totaled $2,761.5 million for the third quarter of
1996 compared to $2,586.2 million for the third quarter of 1995, an
increase of $175.3 million or 6.8%. Growth in loan volume continued with
loans averaging $2,042.3 million for the third quarter of 1996 compared to
$1,938.6 million for the third quarter of 1995 (an increase of $103.7
million) and $1,997.4 million for the second quarter of 1996 (an increase
of $44.9 million). Available for sale and held to maturity securities
averaged $676.1 million for the third quarter of 1996, an increase of $89.4
million compared to the same period last year. Average deposit volume for
the third quarter of 1996 increased $33.5 million to $2,356.8 million
compared to the same period in 1995. Average time deposits increased $11.8
million in the third quarter of 1996 as compared to the third quarter of
1995. Savings and money market deposits increased $24.1 million while
interest bearing demand deposits decreased $5.3 million for the same
respective periods. Non-interest bearing demand deposits increased $2.9
million and comprised 17.4% of average deposits for the third quarter of
1996 compared to 17.5% for the same period last year. Average long-term
debt decreased $17.1 million, primarily due to the redemption of the 8 1/2%
debentures on March 1, 1996.
<PAGE> 10
<TABLE>
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY; INTEREST RATES AND INTEREST DIFFERENTIAL
The following table shows the condensed average balance sheets for each of the interim periods presented, and the average yield on
such categories of interest earning assets and the average rates paid on such categories of interest bearing liabilities for each
of the periods reported.
<CAPTION>
Nine Months Ended September 30, 1996 Nine Months Ended September 30, 1995
------------------------------------- -------------------------------------
Average Yield/ Average Yield/
(in thousands of dollars) Balance Interest Rate Balance Interest Rate
- ----------------------------------------------------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest earning assets:
Loans <F1><F2> $2,007,793 $135,647 9.02% $1,908,842 $136,259 9.54%
Taxable held to maturity securities 237,914 11,543 6.48% 342,340 17,235 6.73%
Non-taxable held to maturity securities<F1> 2,581 155 8.02% 3,450 218 8.45%
Available for sale securities<F1> 449,195 20,948 6.23% 241,718 11,198 6.19%
Trading securities 50,411 2,401 6.36% 43,462 2,113 6.50%
Federal funds sold and securities
purchased under resale agreements 7,726 359 6.21% 12,506 563 6.02%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest earning assets 2,755,620 171,053 8.29% 2,552,318 167,586 8.78%
- ------------------------------------------------------------------------------ ----------------------------------
Cash and due from banks 109,394 107,416
Other assets 110,738 122,492
FASB No. 115 allowance (4,435) (7,483)
Allowance for loan losses (31,033) (29,559)
- ------------------------------------------------------ ----------
Total $2,940,284 $2,745,184
- --------------------------------------------========== ==========
LIABILITIES AND SHAREHOLDER'S EQUITY
Interest bearing demand deposits $ 226,066 3,350 1.98% $ 227,050 3,631 2.14%
Savings and money market deposits 686,381 18,715 3.64% 677,893 19,401 3.83%
Time deposits 1,038,722 43,947 5.65% 956,563 39,164 5.47%
Short-term borrowings 252,711 9,482 5.01% 168,407 6,938 5.51%
Long-term debt 6,133 309 6.73% 19,986 1,165 7.79%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest bearing liabilities 2,210,013 75,803 4.58% 2,049,899 70,299 4.59%
- ------------------------------------------------------------------------------ ----------------------------------
Non-interest bearing deposits 405,756 394,997
Other liabilities 47,052 49,764
Shareholders' equity 277,463 250,524
- ------------------------------------------------------ ----------
Total $2,940,284 $2,745,184
- --------------------------------------------========== ==========
Net interest income $ 95,250 $ 97,287
- -----------------------------------------------------------======== ========
Net interest margin 4.62% 5.10%
- -------------------------------------------------------------------------===== =====
<FN>
<F1>Adjusted to a fully taxable basis using federal statutory rate of 35% in 1996 and 1995.
<F2>Includes non-accrual loans.
</FN>
</TABLE>
<PAGE> 11
<TABLE>
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY; INTEREST RATES AND INTEREST DIFFERENTIAL
(continued)
<CAPTION>
Three Months Ended September 30, 1996 Three Months Ended September 30, 1995
------------------------------------- -------------------------------------
Average Yield/ Average Yield/
(in thousands of dollars) Balance Interest Rate Balance Interest Rate
- ----------------------------------------------------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest earning assets:
Loans <F1><F2> $2,042,291 $45,962 8.95% $1,938,629 $46,499 9.52%
Taxable held to maturity securities 228,066 3,682 6.42% 340,321 5,744 6.70%
Non-taxable held to maturity securities<F1> 2,536 51 8.00% 2,469 50 8.03%
Available for sale securities<F1> 445,451 6,878 6.14% 243,887 3,749 6.10%
Trading securities 35,437 544 6.11% 43,060 678 6.25%
Federal funds sold and securities
purchased under resale agreements 7,690 130 6.73% 17,839 264 5.87%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest earning assets 2,761,471 57,247 8.25% 2,586,205 56,984 8.74%
- ------------------------------------------------------------------------------ ----------------------------------
Cash and due from banks 109,029 109,197
Other assets 108,292 124,735
FASB No. 115 allowance (8,792) (2,955)
Allowance for loan losses (31,218) (30,105)
- ------------------------------------------------------ ----------
Total $2,938,782 $2,787,077
- --------------------------------------------========== ==========
LIABILITIES AND SHAREHOLDER'S EQUITY
Interest bearing demand deposits $ 218,393 1,090 1.99% $ 223,681 1,212 2.15%
Savings and money market deposits 692,645 6,356 3.65% 668,569 6,539 3.88%
Time deposits 1,035,331 14,565 5.60% 1,023,558 14,761 5.72%
Short-term borrowings 256,941 3,206 4.96% 124,524 1,624 5.17%
Long-term debt 2,580 35 5.40% 19,716 381 7.67%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest bearing liabilities 2,205,890 25,252 4.55% 2,060,048 24,517 4.72%
- ------------------------------------------------------------------------------ ----------------------------------
Non-interest bearing deposits 410,448 407,513
Other liabilities 43,807 59,032
Shareholders' equity 278,637 260,484
- ------------------------------------------------------ ----------
Total $2,938,782 $2,787,077
- --------------------------------------------========== ==========
Net interest income $31,995 $32,467
- ------------------------------------------------------------======= =======
Net interest margin 4.61% 4.98%
- -------------------------------------------------------------------------===== =====
<FN>
<F1>Adjusted to a fully taxable basis using federal statutory rate of 35% in 1996 and 1995.
<F2>Includes non-accrual loans.
</FN>
</TABLE>
<PAGE> 12
<TABLE>
The following table sets forth, on a tax equivalent basis, the effect of changes in interest income and interest
expense resulting from changes in volumes and rates for the nine and three months ended September 30, 1996.
<CAPTION>
Nine Months Ended September 30,
1996 Compared to 1995
-------------------------------------------
Increase (Decrease) Total
Attributable to Change in<F1> Increase
(in thousands of dollars) Volume Rate (Decrease)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INTEREST INCOME
Loans $ 6,877 $(7,489) $ (612)
Taxable held to maturity securities (5,087) (605) (5,692)
Non-taxable held to maturity securities (53) (10) (63)
Available for sale securities 9,675 75 9,750
Trading securities 332 (44) 288
Federal funds sold and securities
purchased under resale agreements (221) 17 (204)
- ----------------------------------------------------------------------------- ------- -------
Total increase (decrease) in interest earned on assets 11,523 (8,056) 3,467
- ----------------------------------------------------------------------------- ------- -------
INTEREST EXPENSE
Interest bearing demand deposits (16) (265) (281)
Savings and money market deposits 241 (927) (686)
Time deposits 3,445 1,338 4,783
Short-term borrowings 3,210 (666) 2,544
Long-term debt (716) (140) (856)
- ----------------------------------------------------------------------------- ------- -------
Total increase (decrease) in interest paid on liabilities 6,164 (660) 5,504
- ----------------------------------------------------------------------------- ------- -------
Total increase (decrease) in net interest income $ 5,359 $(7,396) $(2,037)
- ----------------------------------------------------------------------======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended September 30,
1996 Compared to 1995
-------------------------------------------
Increase (Decrease) Total
Attributable to Change in<F1> Increase
(in thousands of dollars) Volume Rate (Decrease)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INTEREST INCOME
Loans $ 2,415 $(2,952) $ (537)
Taxable held to maturity securities (1,822) (240) (2,062)
Non-taxable held to maturity securities 1 0 1
Available for sale securities 3,112 17 3,129
Trading securities (117) (17) (134)
Federal funds sold and securities
purchased under resale agreements (167) 33 (134)
- ----------------------------------------------------------------------------- ------- -------
Total increase (decrease) in interest earned on assets 3,422 (3,159) 263
- ----------------------------------------------------------------------------- ------- -------
INTEREST EXPENSE
Interest bearing demand deposits (28) (94) (122)
Savings and money market deposits 230 (413) (183)
Time deposits 168 (364) (196)
Short-term borrowings 1,655 (73) 1,582
Long-term debt (258) (88) (346)
- ----------------------------------------------------------------------------- ------- -------
Total increase (decrease) in interest paid on liabilities 1,767 (1,032) 735
- ----------------------------------------------------------------------------- ------- -------
Total increase (decrease) in net interest income $ 1,655 $(2,127) $ (472)
- ----------------------------------------------------------------------======= ======= =======
<FN>
<F1> For the purposes of this table, changes which are not due solely to volume changes or rate changes are
allocated to such categories based on the respective percentage changes in average balances and average rates.
</FN>
</TABLE>
<PAGE> 13
<TABLE>
NON-INTEREST INCOME
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Nine Months Ended September 30, 1996 1995 % Change
- -----------------------------------------------------------------------------------------------------------------
(in thousands of dollars)
<S> <C> <C> <C>
Service charges on deposit accounts $ 6,061 $ 5,220 16.1%
Securities transactions 234 46 408.7%
Bond Division revenue 9,433 8,831 6.8%
Brokerage revenue 3,796 3,108 22.1%
Trust Division revenue 4,976 4,607 8.0%
Net gains (losses) on sales of foreclosed real estate 377 (77) -
All other income 4,323 5,654 (23.5%)
- ------------------------------------------------------------------ ------- -------
Total non-interest income $29,200 $27,389 6.6%
- -----------------------------------------------------------======= ======= =======
</TABLE>
Non-interest income of $29.200 million increased $1.811 million or 6.6% for
the first nine months of 1996 as compared to the same period of 1995. Non-
interest income for the three month period ended September 30, 1996 was
$9.729 million, an increase of $645 thousand from the third quarter of
1995.
Service charges on deposit accounts showed an increase of $841 thousand or
16.1% in the first nine months of 1996 as compared to the same period in
1995. Third quarter 1996 service charges on deposit accounts showed an
increase of $253 thousand from third quarter of last year. The increase is
attributed to a reduction in the earnings credit rates paid to commercial
accounts to offset the cost of deposit services combined with an increase
in the fee charged for NSF checks.
Gains totaling $234 thousand on sales of available for sale securities were
realized in the first quarter of 1996. Proceeds from the sale of these
securities were $36.175 million. In the first quarter of 1995, $5.676
million of available for sale securities were sold with gains totaling $46
thousand. There were no sales of securities in the second or third quarter
of either year.
The Capital Markets Group (including Bond and Brokerage operations) showed
an increase of $1.290 million or 10.8% in revenues for the nine month
period ending September 30, 1996 as compared to the same period last year.
Bond Division revenues increased $602 thousand or 6.8% in the first nine
months of 1996 compared to the first nine months of 1995. Foreign exchange
revenues accounted for $519 thousand of the increase. Brokerage revenues
increased $688 thousand or 22.1% in the first nine months of 1996 compared
to the same period last year. Bond Division and Brokerage revenues for the
third quarter of 1996 showed a decrease of $168 thousand and a increase of
$48 thousand, respectively, from third quarter 1995.
Trust Division revenues increased $369 thousand and $128 thousand for the
first nine months of 1996 and the third quarter of 1996, respectively,
compared to the same periods last year. The increase is attributed to an
expanded customer base and fees associated from increased sales of
proprietary mutual funds.
<PAGE> 14
(Non-interest Income continued)
Net gains recognized on sales of foreclosed property for the first nine
months of 1996 were $377 thousand, with $250 thousand occurring in the
second quarter. Proceeds from sales of foreclosed property in the first
nine months of 1996 totaled $3.776 million. For the first nine months of
1995, proceeds from sales of foreclosed property totaled $2.392 million and
included net losses of $77 thousand.
All other income decreased $1.331 million or 23.5% for the first nine
months of 1996 as compared to the same period of 1995. Changes in the
market value of the Company's proprietary trading accounts showed a net
gain of $554 thousand for the nine months of 1996 compared to a net gain of
$1.716 million for the first nine months of 1995, resulting in a decrease
period to period of $1.162 million. Rental income decreased $420 thousand
for the first nine months of 1996 compared to the same period last year due
to the sale of a low- to moderate-income housing project, owned and
operated by the Company, in June of 1995 (related operating expense
reductions discussed later). A $206 thousand gain recorded on the sale
also contributed to the decrease. These decreases period to period were
offset by a $350 thousand fee received in the third quarter of 1996 for
participation in a commission on the transfer of the Company's credit card
base to a new issuing bank. A gain on sale of land recorded in the second
quarter of 1996 of $142 thousand also offset the decrease period to period.
All other income for the third quarter of 1996 increased $263 thousand
compared to the third quarter of 1995. Excluding the $350 thousand
transfer fee noted above, all other income for the third quarter of 1996
decreased $87 thousand from the same period last year. Comparing third
quarter of 1996 to third quarter of 1995, the increase in the change in
market value of the proprietary trading accounts was offset by the decrease
in income associated with the sale of the low- to moderate-income housing
project.
<TABLE>
NON-INTEREST EXPENSE
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Nine Months Ended September 30, 1996 1995 % Change
- -----------------------------------------------------------------------------------------------------------------------
(in thousands of $)
<S> <C> <C> <C>
Salary expense $31,692 $31,098 1.9%
Employee benefits 5,276 5,202 1.4%
Net occupancy 6,716 7,040 (4.6%)
FDIC premiums 6 2,334 (99.7%)
Furniture & equipment 2,581 2,894 (10.8%)
Advertising 916 1,486 (38.4%)
Data processing 3,554 3,166 12.3%
Legal fees 561 730 (23.2%)
Postage & freight 1,125 1,124 0.1%
Amortization expense 738 621 18.8%
Expenses on foreclosed property 149 263 (43.3%)
Taxes other than income 298 390 (23.6%)
Other 6,826 8,272 (17.5%)
- -------------------------------------------------------------------- ------- -------
Total non-interest expense $60,438 $64,620 (6.5%)
- -------------------------------------------------------------======= ======= =======
</TABLE>
Non-interest expense for the first nine months of 1996 was $60.438 million
compared to $64.620 million for the first nine months of 1995, a decrease
of $4.182 million or 6.5%. The Company's efficiency ratio year-to-date was
48.66% compared to 51.85% for the same period last year. Non-interest
<PAGE> 15
(Non-interest Expense continued)
expense for the third quarter of 1996 of $19.491 million, decreased $1.249
million or 6.0% compared to the third quarter of 1995.
Salary expense for the first nine months of 1996 increased $594 thousand or
1.9% as compared to the same period last year. Excluding the effect of
commissions and bonuses, salary expense increased $688 thousand or 3.0%.
The number of full time equivalent employees was 998 at September 30, 1996
compared to 979 at September 30, 1995. Commission and bonus expense
decreased 1.1% for the first nine months of 1996 compared to the first nine
months of 1995. Excluding an accrual in the third quarter of 1995 for a
one-time employee bonus paid to all employees not already participating in
a commission or incentive-based program, commission and bonus expense
increased slightly period to period. Employee benefit expense increased
$74 thousand or 1.4% for the first nine months of 1996 as compared to the
same period in 1995.
Net occupancy expense decreased $324 thousand or 4.6% for the first nine
months of 1996 as compared to the same period last year. As discussed
earlier, the sale of a low-to-moderate-income housing project owned and
operated by the Company resulted in a $355 thousand reduction in expenses
associated with the property from period to period.
FDIC premiums expense decreased $2.328 million or 99.7%. In August 1995,
the FDIC Board of Directors voted to reduce deposit insurance premiums to
$.04 from $.23 per $100 of assessable deposits. The effective date for the
premium change was June 1, 1995. In 1996, the premium charged to the
Company's bank subsidiaries was reduced to $2 thousand per charter per
year.
Furniture and equipment expense decreased $313 thousand or 10.8% for the
first nine months of 1996 compared to the same period in 1995. The decline
is due to a general decrease in depreciation expense and includes computer
hardware which became fully depreciated in the second quarter of 1995.
Advertising expense decreased $570 thousand or 38.4% for the first nine
months of 1996 from the same period of 1995. Advertising expense for the
third quarter of 1996 decreased $226 thousand compared to the third quarter
of 1995. Expenses for 1995 included expenditures for a television
advertising campaign not repeated in 1996.
Data processing fees for the first nine months of 1996 increased $388
thousand or 12.3% compared to the same period last year. Data processing
expense was reduced by $355 thousand in the third quarter of 1995 for a
settlement of a contract dispute with a systems vendor. The settlement
essentially reimbursed the Company for the difference between the contract
rates and actual expenses paid by the Company due to nonperformance under
the contract. Excluding this 1995 non-recurring item, data processing
expense increased $33 thousand for the first nine months of 1996 compared
to the same period of 1995.
<PAGE> 16
(Non-interest Expense continued)
Legal fees continued to decline period to period, with a decrease of $169
thousand or 23.2% for the first nine months of 1996 compared to the same
period last year.
Amortization expense increased $117 thousand or 18.8% for the first nine
months of 1996 compared to the same period of 1995 and is primarily
attributed to increased capital note fee amortization. On March 1, 1996
the Company called for the redemption of its 8 1/2% debentures due 1999 at
1% premium over par. Amortization expense related to these debentures
increased $78 thousand year to year. Amortization expense for the 7%
convertible subordinated notes increased $38 thousand for the same
respective period related to the notes converted.
Expenses on foreclosed property decreased $114 thousand or 43.3% for the
first nine months of 1996 compared to the first nine months of last year.
Foreclosed property at September 30, 1996 totaled $3.515 million compared
to $10.726 million at September 30, 1995.
Other non-interest expenses for the first nine months of 1996 decreased
$1.446 million or 17.5% from the same period last year. Insurance expense
decreased $322 thousand for the first nine months of 1996 as compared to
the same period in 1995 primarily related to an increase in the cash
surrender value of life insurance policies offsetting the premium expense.
Operating expenses related to a low- to moderate-income housing project
sold in June 1995, as discussed earlier, decreased $173 thousand from the
same period last year. Valuation adjustments of $243 thousand were made to
miscellaneous investments in 1995. Consulting expense for the first nine
months of 1996 decreased $470 thousand compared to the same period last
year. Last year's expense included an individual consulting contract which
terminated at year-end 1995 and consulting engagements running throughout
1995 for the purpose of enhancing banking based non-interest revenues and
improving operational flow. Convention and meeting expenses for the
September 1995 Director Trip attributed to a $320 thousand decrease in
expense for the first nine months of 1996 compared to the same period last
year. A renegotiated customer check printing contract contributed to a
$134 thousand reduction of stationary and supplies expense in 1996. Due to
increased loan activity, the deferral of loan costs recorded as a reduction
of non-interest expense in accordance with SFAS No. 91 increased, resulting
in a reduction in expense of $167 thousand period to period. The above
reductions in non-interest expense were offset by a 1% call premium of $116
thousand paid on the redemption of the 8 1/2% debentures on March 1, 1996
and a $125 thousand fee paid upon listing with the New York Stock Exchange
in September 1996.
Other non-interest expenses for the third quarter of 1996 decreased $466
thousand compared to third quarter 1995. Consulting expense, as discussed
above, decreased $326 thousand period to period. Conventions and meeting
expense decreased $216 thousand period to period. These decreases were
offset by the $125 thousand increase in miscellaneous fees related to the
New York Stock Exchange listing fee. The remaining variance was comprised
of various other miscellaneous categories.
<PAGE> 17
<TABLE>
SUMMARY OF ALLOWANCE FOR LOAN LOSSES
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
--------------------------- -----------------------------
(in thousands of dollars) 1996 1995 1996 1995
- ----------------------------------------------------------------------------------- -----------------------------
<S> <C> <C> <C> <C>
Allowance at beginning of period $30,508 $28,894 $31,198 $29,961
Allowance of acquired bank 586 - 586 -
Charge-offs (1,981) (2,957) (397) (910)
Recoveries 954 767 175 284
- ----------------------------------------------------------------------------------- ----------------------------
Net charge-offs (1,027) (2,190) (222) (626)
- ----------------------------------------------------------------------------------- ----------------------------
Additions to allowance charged to expense 2,001 3,344 506 713
- ----------------------------------------------------------------------------------- ----------------------------
Allowance at end of period $32,068 $30,048 $32,068 $30,048
- ----------------------------------------------------------========================= ============================
Loans, net of unearned income at end of period $2,143,218 $1,938,585 $2,143,218 $1,938,585
Average loan balance for the period $2,007,793 $1,908,842 $2,042,291 $1,938,629
Allowance as % of loans at end of period 1.50% 1.55%
Allowance as % of non-performing loans 374.80% 323.90%
Net charge-offs as % of average loans for the period .05% .11% .01% .03%
Annualized net charge-offs as % of average loans
for the period .07% .15% .04% .13%
</TABLE>
The provision for loan losses for the first nine months of 1996 was
$2.001 million compared to $3.344 million for the first nine months of
1995. Net charge-offs totaled $1.027 million for the first nine months of
1996 compared to $2.190 million for the first nine months of 1995, a
decrease of $1.163 million. Annualized net charge-offs were .07% of
average loans for the first nine months of 1996 compared to .15% for the
same period in 1995. The provision for loan losses for the third quarter
of 1996 was $506 thousand compared to $713 thousand for the third quarter
of 1995. Net charge-offs for the third quarter of 1996 totaled $222
thousand compared to $626 thousand for the same period last year, a
decrease of $404 thousand.
The Company evaluates the reserves of its subsidiary banks on an
ongoing basis to ensure the timely charge-off of loans and to determine the
adequacy of each bank's allowance for loan losses. At September 30, 1996,
the level of the affiliate bank reserves as a percentage of total loans
outstanding ranged from 1.43% to 1.50% with a combined ratio of 1.50%.
Management believes the current consolidated allowance at 1.50% of total
loans outstanding is adequate to absorb future possible losses.
<PAGE> 18
<TABLE>
NON-PERFORMING ASSETS
<CAPTION>
September 30, June 30, March 31, December 31,
(in thousands of dollars) 1996 1996 1996 1995
- ------------------------------ ------------- ----------- ------------ --------------
<S> <C> <C> <C> <C>
Non-accrual loans $ 5,596 $ 6,531 $ 7,764 $13,663
Restructured loans 2,275 2,100 109 109
Foreclosed property 3,515 4,436 6,105 6,099
------- ------- ------- -------
Total non-performing assets $11,386 $13,067 $13,978 $19,871
======= ======= ======= =======
Percentage of non-performing assets
to loans plus foreclosed property .53% .65% .69% 1.00%
Loans contractually past due ninety
days or more $685 $691 $836 $530
Percentage of non-performing assets
plus ninety days past due to loans
plus foreclosed property .56% .68% .73% 1.03%
Percentage of allowance to
non-performing loans 374.80% 334.67% 358.23% 213.31%
Percentage of allowance to total
non-performing assets 281.64% 238.75% 223.19% 153.53%
Percentage of allowance to
risk elements<F1> 265.66% 226.76% 210.60% 149.54%
Percentage of risk elements<F1>
to total average assets .41% .47% .50% .74%
<FN>
<F1> Risk elements include total non-performing assets plus loans contractually past due ninety days or more.
</FN>
</TABLE>
<TABLE>
The following table summarizes the changes in non-performing assets for the periods shown:
<CAPTION>
Nine Months Ended
September 30,
(in thousands of dollars) 1996 1995
- -----------------------------------------------------------------
<S> <C> <C>
Balance, beginning of year $19,871 $17,820
Balance of acquired bank 249 -
Additions 7,837 13,840
Payments received and loans
returned to accrual status (11,485) (6,946)
Sales of foreclosed property (3,394) (2,512)
Charge-offs and writedowns (1,692) (2,738)
- ---------------------------------------------------- -------
Balance, end of period $11,386 $19,464
- ---------------------------------------------======= =======
</TABLE>
Loan quality remained strong at the end of third quarter 1996
reflecting the Company's continued focus on maintaining high quality
assets. Non-performing assets at September 30, 1996 were .53% of loans
plus foreclosed property compared to 1.00% at December 31, 1995 and 1.00%
at September 30, 1995. Non-performing assets of $11.386 million at
September 30, 1996 were $8.485 million or 42.7% lower than at December 31,
1995 and $8.078 million or 41.5% lower than at September 30, 1995.
<PAGE> 19
<TABLE>
CAPITAL RESOURCES AND LIQUIDITY
<CAPTION>
SEPTEMBER 30, SEPTEMBER 30,
(in thousands of dollars) 1996 1995
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
At September 30,
- ----------------
Total shareholders' equity $289,433 $263,861
Long-term debt $2,425 $19,423
Per Share Data
- --------------
Dividend payout ratio 39.08% 37.33%
Common dividends paid $15,017 $12,986
Dividends paid per share $0.93 $0.81
Book value per share $17.66 $16.43
Fully diluted book value per share $17.65 $16.41
Selected Ratios
- ---------------
Return on YTD average assets 1.77% 1.72%
Return on YTD average common equity 18.76% 18.79%
Return on YTD average realized common equity 18.58% 18.45%
YTD average equity to average assets 9.44% 9.13%
YTD average equity to average loans 13.82% 13.12%
YTD average loans to average deposits 85.19% 84.59%
Period end total tier 1 capital to total risk-weighted assets 11.10% 11.08%
Period end total capital to total risk-weighted assets 12.43% 12.66%
Efficiency ratio 48.66% 51.85%
</TABLE>
The Company's total shareholders' equity was $289.433 million at
September 30, 1996 which reflects a $25.572 million or 9.7% increase
compared to September 30, 1995. In early 1995, the Company's Board of
Directors authorized management to purchase up to one million shares of the
Company's common stock in a systematic pattern to meet the common stock
requirements of the Mark Twain 1995 Stock Option Plan and other corporate
purposes. During 1995, the Company repurchased approximately 109,000
shares under this program for principally the benefit plan. During the
first nine months of 1996, the Company purchased approximately 181,000
shares for the benefit plan. In addition, the Company has purchased
approximately 295,000 shares related to the conversion of its 7%
Convertible Subordinated Capital Notes. As of September 30, 1996,
approximately 287,000 of the shares purchased related to the Notes have
been reissued upon conversion.
Mark Twain's Asset/Liability Committee meets monthly to review balance
sheet structure and liquidity needs. The goal is to maximize net interest
income and maintain adequate liquidity while operating within defined risk
parameters. The period gap set forth in the table below is the difference
between earning assets and interest bearing liabilities with the repricing
maturities indicated. The cumulative gap figure accumulates the period
figures for the maturity range in question and all shorter maturities. The
position of Mark Twain with respect to these gaps at September 30, 1996 was
as follows (dollars in thousands):
<TABLE>
<CAPTION>
0-31 32-92 93-183 184-365 Over 365
Days Days Days Days Days
----------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Period Gap $(12,191) $ (67,179) $(104,500) $ (159,290) $885,900
Cumulative Gap (12,191) (79,370) (183,870) (343,160) 542,740
</TABLE>
<PAGE> 20
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 11. Statement of Computation of Earnings Per Common Share
Exhibit 27. Financial Data Schedule
(b) Reports on Form 8-K
Report on Form 8-K dated July 11, 1996 reporting the Company's
earnings release for the second quarter and year ending June 30,
1996.
Report on Form 8-K dated October 10, 1996 reporting the Company's
earnings release for the third quarter and year ending September 30,
1996.
Report on Form 8-K dated November 6, 1996 announcing an Agreement and
Plan of Reorganization between Company, Mercantile Bancorporation
Inc. (Mercantile) and Ameribanc, Inc., a wholly owned subsidiary of
Mercantile.
<PAGE> 21
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
MARK TWAIN BANCSHARES, INC.
(Registrant)
Date: November 14, 1996 /s/ KEITH MILLER
----------------- -------------------------------
Keith Miller
Executive Vice President - Finance
and Chief Financial Officer
/s/ JOHN P. DUBINSKY
-------------------------------
John P. Dubinsky
President and Chief
Executive Officer
<PAGE>
EXHIBIT 11
<TABLE>
MARK TWAIN BANCSHARES, INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
<CAPTION>
For The Nine Months Ended For The Three Months Ended
September 30, September 30,
(in thousands of dollars except per share data) 1996 1995 1996 1995
- -------------------------------------------------------------------------------------- ---------------------------
<S> <C> <C> <C> <C>
PRIMARY
Earnings:
Net income $38,970 $35,216 $13,464 $12,223
- -----------------------------------------------------------=========================== ===========================
Shares:
Weighted average number of common shares outstanding 16,091,880 16,037,190 16,023,402 16,034,868
Weighted average number of common share equivalents 276,747 210,972 276,378 252,493
- -------------------------------------------------------------------------------------- ---------------------------
16,368,627 16,248,162 16,299,780 16,287,361
- -----------------------------------------------------------=========================== ===========================
Primary earnings per common share $2.38 $2.17 $0.83 $0.75
- -----------------------------------------------------------=========================== ===========================
ASSUMING FULL DILUTION
Earnings:
Net income $38,970 $35,216 $13,464 $12,223
After tax interest applicable to convertible notes 95 277 23 88
After tax amortization of capital note fees 58 34 12 13
- -------------------------------------------------------------------------------------- ---------------------------
Fully diluted net income $39,123 $35,527 $13,499 $12,324
- -----------------------------------------------------------=========================== ===========================
Shares:
Weighted average number of common shares outstanding 16,091,880 16,037,190 16,023,402 16,034,868
Assuming conversion of Convertible Notes and dilutive
stock options 574,331 791,370 505,473 769,089
- -------------------------------------------------------------------------------------- ---------------------------
16,666,211 16,828,560 16,528,875 16,803,957
- -----------------------------------------------------------=========================== ===========================
Earnings per common share assuming full dilution $2.35 $2.11 $0.82 $0.73
- -----------------------------------------------------------=========================== ===========================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET, CONSOLIDATED STATEMENT OF INCOME AND
CONSOLIDATED STATEMENT OF CASH FLOWS AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 169,932
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 15,879
<TRADING-ASSETS> 43,669
<INVESTMENTS-HELD-FOR-SALE> 459,690
<INVESTMENTS-CARRYING> 225,384
<INVESTMENTS-MARKET> 222,124
<LOANS> 2,143,218
<ALLOWANCE> 32,068
<TOTAL-ASSETS> 3,147,933
<DEPOSITS> 2,432,484
<SHORT-TERM> 359,192
<LIABILITIES-OTHER> 64,399
<LONG-TERM> 2,425
0
0
<COMMON> 21,089
<OTHER-SE> 268,344
<TOTAL-LIABILITIES-AND-EQUITY> 3,147,933
<INTEREST-LOAN> 134,902
<INTEREST-INVEST> 32,547
<INTEREST-OTHER> 359
<INTEREST-TOTAL> 170,209
<INTEREST-DEPOSIT> 66,012
<INTEREST-EXPENSE> 75,803
<INTEREST-INCOME-NET> 94,406
<LOAN-LOSSES> 2,001
<SECURITIES-GAINS> 234
<EXPENSE-OTHER> 60,438
<INCOME-PRETAX> 61,167
<INCOME-PRE-EXTRAORDINARY> 38,970
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 38,970
<EPS-PRIMARY> 2.38
<EPS-DILUTED> 2.35
<YIELD-ACTUAL> 4.62
<LOANS-NON> 5,596
<LOANS-PAST> 685
<LOANS-TROUBLED> 2,275
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 30,508
<CHARGE-OFFS> 1,981
<RECOVERIES> 954
<ALLOWANCE-CLOSE> 32,068
<ALLOWANCE-DOMESTIC> 32,068
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
